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Edited version of your private ruling
Authorisation Number: 1012492941107
Ruling
Subject: Stamp duty payable on the acquisition of a leasehold property
Question
Are you entitled to a deduction for the stamp duty incurred in acquiring crown leases for properties you will use solely for the purpose of producing assessable income?
Answer
Yes.
This ruling applies for the following period
1 July 2012 to 30 June 2013
The scheme commences on:
1 July 2012
Relevant facts and circumstances
You acquired some rental properties.
The properties are held under 99-year crown leases.
You incurred stamp duty in acquiring the leasehold properties.
Relevant legislative provisions
Income Tax Assessment Act 1997 subsection 25-20(1)
Reasons for decision
You can deduct expenditure you incur for preparing, registering or stamping a lease of property if you have used, or will use, the property solely for the purpose of producing assessable income (subsection 25-20(1) of the Income Tax Assessment Act 1997).
The 99-year crown leases you hold on the two properties satisfy the general law requirement that a lease must be granted for a definite period.
As you intend to use the properties solely for the purpose of producing assessable income, you are entitled to a deduction for the stamp duty you incurred to acquire the leasehold over the properties.
The legislation does not provide that the deduction be amortised over either a set period of time or for the duration of the lease. It is implicit, therefore, that the expense is deductible in the year that it is incurred.